“Do I anticipate that partners of ours will build the lion’s share of all Windows devices over the next five years? The answer is, absolutely,” Ballmer said in an interview with reporters recently. ”With that said, it is absolutely clear that there is an innovation opportunity on the scene between hardware and software and that is a scene that must not go unexploited at all by Microsoft.” So, ultimately, if Microsoft sees an area to innovate in, why would it pass it up?

Sure, you could read this in a number of ways – Ballmer doesn’t come out and say that Microsoft is already working on a Windows Phone 8 device, but he’s also saying that there’s huge potential for the company to do so. My guess is that Microsoft will see how its partners fare with the current batch of devices and will enter the game depending on where it sees a weakness or an opportunity where it can shine or offer something different.

Maybe we’ll have to wait for Windows Phone 9 before we see it, however.